6 ms·

Because debt issued by a soverign and denominated in its own currency is fundamentally different to debt accrued by a private entity.

by yrro 7y ago

pgeorgi 7y ago
One design quirk of the Euro is that there is no sovereign to go with it.
- jwieczorek 7y ago
  Yes, Euro is a disaster. It's a predominantly ideological project that economically is totally unsound. Okay, it was conceived as a way to boost the German economy (before Euro the German mark was just too strong so Germany couldn't export as much as it does now) but ends up painfully backfiring at all Euro economies. First the weaker economies (Greece and Italy) and now Germany.
  - pgeorgi 7y ago
    > it was conceived as a way to boost the German economy (before Euro the German mark was just too strong Interesting theory, but I wonder when the German economy was so strong that Germany forced the rest of Europe to agree to the Euro: When the first plans for an economic and monetary union within the EEC were brought up in 1969? Or in 1979, when European currencies were pegged against the ECU, stabilizing exchange rates (and taking large parts of monetary policy out of the member states' hands)? Maybe in 1989 when France made German reunification depend on Germany committing to the monetary union?
  - inflatableDodo 7y ago
    >Yes, Euro is a disaster. It's a predominantly ideological project that economically is totally unsound. It has been running for about 20 years, becoming the world's second most traded currency after the dollar and without it Europe would still be a mixed bag of national currencies rather than being one of the big three economic powers. If the euro is totally economically unsound, then I must say that it is doing rather well considering. Personally, I store all my wealth in a 3 ton rai stone sunk in deep water 60 km NNW off the isle of Yap. There are some limits on fungibility, but the transaction security is excellent.
starbugs 7y ago
So why not print all the money everyone needs? I'd start off with a couple of million EURs. Oh, you also want a couple of million? No problem. Oops, hyper inflation and we're back at the start. Seriously, this doesn't work.
- bryanlarsen 7y ago
  The article claims that German/European inflation is too low, they should be printing more money (or an equivalent, like borrowing)
  - starbugs 7y ago
    The ECB has been "printing money" like crazy for the last decade. Inflation in Germany is between 1 and 2 percent. Why is that a problem? If you've saved some money it's already eating up about 1% (or more) on an annual basis since you don't get any interest anymore. Money has had a value until 2008. Then somehow the rules were rewritten and now you are getting penalized for saving so you can later invest. This doesn't make any sense.
    - bryanlarsen 7y ago
      Of course you should be penalizing for saving. Hiding a dollar away where it's not doing any good to the world economy? You should get rewarded for investing, taking risks and letting that dollar do something.
      - starbugs 7y ago
        You are basically saying that I don't have a right to preserve my wealth for the time period I see fit and that the government (I consider the central banks to be part of the gov) should enforce that by manipulating interest rates. What's next? Prohibit ownership of precious metals (again)?
        bryanlarsen 7y ago

Because debt issued by a soverign and denominated in its own currency is fundamentally different to debt accrued by a private entity.

by yrro 7y ago

Because debt issued by a soverign and denominated in its own currency is fundamentally different to debt accrued by a private entity.

pgeorgi 7y ago

One design quirk of the Euro is that there is no sovereign to go with it.

jwieczorek 7y ago
Yes, Euro is a disaster. It's a predominantly ideological project that economically is totally unsound. Okay, it was conceived as a way to boost the German economy (before Euro the German mark was just too strong so Germany couldn't export as much as it does now) but ends up painfully backfiring at all Euro economies. First the weaker economies (Greece and Italy) and now Germany.
- pgeorgi 7y ago
  > it was conceived as a way to boost the German economy (before Euro the German mark was just too strong Interesting theory, but I wonder when the German economy was so strong that Germany forced the rest of Europe to agree to the Euro: When the first plans for an economic and monetary union within the EEC were brought up in 1969? Or in 1979, when European currencies were pegged against the ECU, stabilizing exchange rates (and taking large parts of monetary policy out of the member states' hands)? Maybe in 1989 when France made German reunification depend on Germany committing to the monetary union?
- inflatableDodo 7y ago
  >Yes, Euro is a disaster. It's a predominantly ideological project that economically is totally unsound. It has been running for about 20 years, becoming the world's second most traded currency after the dollar and without it Europe would still be a mixed bag of national currencies rather than being one of the big three economic powers. If the euro is totally economically unsound, then I must say that it is doing rather well considering. Personally, I store all my wealth in a 3 ton rai stone sunk in deep water 60 km NNW off the isle of Yap. There are some limits on fungibility, but the transaction security is excellent.

starbugs 7y ago

So why not print all the money everyone needs? I'd start off with a couple of million EURs. Oh, you also want a couple of million? No problem. Oops, hyper inflation and we're back at the start. Seriously, this doesn't work.

bryanlarsen 7y ago
The article claims that German/European inflation is too low, they should be printing more money (or an equivalent, like borrowing)
- starbugs 7y ago
  The ECB has been "printing money" like crazy for the last decade. Inflation in Germany is between 1 and 2 percent. Why is that a problem? If you've saved some money it's already eating up about 1% (or more) on an annual basis since you don't get any interest anymore. Money has had a value until 2008. Then somehow the rules were rewritten and now you are getting penalized for saving so you can later invest. This doesn't make any sense.
  - bryanlarsen 7y ago
    Of course you should be penalizing for saving. Hiding a dollar away where it's not doing any good to the world economy? You should get rewarded for investing, taking risks and letting that dollar do something.
    - starbugs 7y ago
      You are basically saying that I don't have a right to preserve my wealth for the time period I see fit and that the government (I consider the central banks to be part of the gov) should enforce that by manipulating interest rates. What's next? Prohibit ownership of precious metals (again)?
      - bryanlarsen 7y ago